What happened
Shares of the Brazilian digital bank Nu Holdings (NU -0.43%) traded roughly 7.3% higher as of 11:56 a.m. ET today after the company reported earnings results for the fourth quarter of 2022.
So what
Nu reported a record profit of $58 million on record revenue of $1.45 billion. The company added 4.2 million customers and now has 74.6 million, including 61.2 million active customers. Nu now banks 44% of the Brazilian adult population.
It also continued to grow monthly average revenue per active customer (ARPAC), a key profitability metric at the bank. ARPAC across the bank grew to $8.20, while the bank's most-mature cohorts (the customers who have been with the bank the longest) saw ARPAC reach $23.
Nu also picked up the pace of loan growth after slowing down in recent quarters. The company's total loan portfolio grew $1.6 billion in the fourth quarter, reaching $11.3 billion in total.
It also added $1.8 billion in deposits in the quarter and now has $15.8 billion in total deposits. The cost of the bank's deposits also declined in the quarter.
The bank's rate for non-performing loans (NPLs) that were delinquent for more than 90 days increased in the quarter, but the rate for 15- to 90-day NPLs declined.
Now what
Ultimately, Nu looks to have had a good quarter, growing ARPAC and profitability, while maintaining strong growth.
The bank is still early in the process of cross-selling its lending products to its Brazilian customers and is also ramping up operations in Mexico and Colombia, so I think Nu Holdings has a bright future.
